Edit This Favorite

The following are the new South Carolina laws related to liquor-by-the-drink. All sections are effective January 1, 2006 with the exception that federally licensed liquor stores can deliver minibottles to restaurants beginning June 8, 2005 until January 1, 2006, after which they can sell and deliver any size bottle to restaurants except the 1.75 liter.

There are many sections as "minibottles" were referenced in a lot of different places in law.

SECTION 1. Article 5, Chapter 6, Title 61 of the 1976 Code is amended by adding:

"Section 61-6-1636. (A) A person licensed by this article for sale and use for on-premises consumption shall purchase alcoholic liquor for sale by the drink from a licensed retail dealer with a wholesaler's basic permit issued pursuant to the Federal Alcohol Administration Act in any size bottle, except 1.75 liter size bottles.

(B) A licensed retail dealer with a wholesaler's basic permit issued pursuant to the Federal Alcohol Administration Act may deliver, in sealed containers, alcoholic liquor in any size bottle, except 1.75 liter size bottles, to a person licensed by this article to sell alcoholic liquors for on-premises consumption.

Section 61-6-1637. A person licensed pursuant to this article, including his agent, may not substitute another brand of alcoholic liquor in place of the brand specified by a customer unless the licensee or his agent has: (1) advised the customer that the desired brand is not available, and (2) received the customer's approval of substitution. A person who violates this section is guilty of a misdemeanor and, upon conviction, must be fined not more than one hundred dollars or imprisoned not more than ten days, or both."

SECTION 2. Chapter 6, Title 61 of the 1976 Code is amended by adding:

"Section 61-6-2430. A wholesale distributor of alcoholic liquor may discount product price based on quantity purchases if all discounts are on price only for each location, appear on the sales records, and are available to all licensed retail dealers with a wholesaler's basic permit issued pursuant to the Federal Alcohol Administration Act or any other alcoholic liquor retail license."

SECTION 3. Section 12-33-245 of the 1976 Code is amended to read:

"Section 12-33-245. (A) In lieu ofaddition to taxes imposed underpursuant to the provisions of Sections 12-33-230,and 12-33-240, Article 5 of this chapter, and Chapter 36, Title 12, there is imposed an excise tax equal to five percent of the gross proceeds of the sales of alcoholic liquorliquors sold in minibottles must be taxed at the rate of twenty-five cents for each container in addition to the case tax as prescribed in Article 5 of this chapter and collected as those taxes are collected. Taxes levied in Article 3 of this chapter do not applyby the drink for on-premises consumption in an establishment licensed for sales pursuant to Article 5, Chapter 6, Title 61. All proceeds of this excise tax must be deposited to the credit of the general fund of the State. Except with respect to the distribution of the revenue of this tax, this excise tax is considered to be imposed pursuant to Chapter 36, Title 12. For purposes of this subsection, 'gross proceeds of sales' has the meaning as provided in Section 12-36-90, except that the sales tax imposed under Chapter 36, Title 12 is not included in 'gross proceeds of sales'.

(B) Eleven percent of the revenue generated by the excise tax provided for in subsection (A) must be placed on deposit with the State Treasurer and credited to a fund separate and distinct from the general fund of the State. On a quarterly basis, the State Treasurer shall allocate this revenue to counties on a per capita basis according to the most recent United States Census. The State Treasurer must notify each county of the allocation pursuant to this subsection in addition to the funds allocated pursuant to Section 6-27-40(B), and the combination of these funds must be used by counties for educational purposes relating to the use of alcoholic liquors and for the rehabilitation of alcoholics and drug addicts. CountiesA county may pool these funds with other counties and may combine these funds with other funds for the same purpose.

(C)Those state agencies and local entities, including counties, which are allocated and receive by law minibottle tax revenues in fiscal year 2003-04 for education, prevention, and other purposes, shall receive at least the same amount of revenues from the new excise tax revenues beginning with the first full fiscal year after sales of liquor by the drink are authorized as they did from minibottle tax revenues during fiscal year 2003-04. If these state agencies and local entities do not, the difference must be made up from the general fund within sixty days after the close of each fiscal year."

SECTION 4. Section 12-36-90(2) of the 1976 Code, as last amended by Act 237 of 2004, is further amended by adding an appropriately lettered subitem to read:

SECTION 5. Section 61-4-120 of the 1976 Code, as last amended by Act 70 of 2003, is further amended to read:

"Section 61-4-120. It is unlawful for a person to sell or offer for sale wine or beer in this State between the hours of twelve o'clock Saturday night and sunrise Monday morning. However, an establishment licensed pursuant to Article 5 of Chapter 6 is authorized to sell these products during those hours in which the sale of alcoholic liquors in minibottlesby the drink is lawful. A person who violates the provisions of this section is considered guilty of a misdemeanor and, upon conviction, must be fined not more than one hundred dollars or imprisoned for not more than thirty days. The right of a person to sell wine and beer in this State under a license issued by the State must be forfeited and the license revoked upon his conviction of violating the provisions of this section."

SECTION 6. Section 61-4-570 of the 1976 Code, as added by Act 415 of 1996, is amended to read:

"Section 61-4-570. Notwithstanding any other provision of law, an establishment that holds a valid beer and wine license and a license to sell alcoholic liquors in minibottlesby the drink may sell wine which is not in excess of twenty-one percent of alcohol by volume, to be consumed on the premises."

SECTION 7. Section 61-4-770 of the 1976 Code, as last amended by Act 76 of 2001, is further amended to read:

"Section 61-4-770. Wines containing more than sixteen percent of alcohol by volume may be sold only in licensed alcoholic liquor stores or in establishments licensed to sell and permit consumption of alcoholic liquors in minibottlesby the drink."

SECTION 8. Section 61-4-1720 of the 1976 Code, as added by Act 415 of 1996, is amended to read:

"Section 61-4-1720. The brewpub permit provided for in this article is in lieu of a permit required for the manufacture of beer or sale of beer and wine including, but not limited to, a brewer's and retailer's permit. The sale of alcoholic liquors for consumption on the premises in minibottlesby the drink requires an appropriate license which may be issued to the holder of a brewpub permit who meets all other qualifications for the license under this title."

SECTION 9. Section 61-6-20(1) of the 1976 Code is amended to read:

"(1)(a) 'Alcoholic liquors' or 'alcoholic beverages' means any spirituous malt, vinous, fermented, brewed (whether lager or rice beer), or other liquors or a compound or mixture thereofof them by whatever name called or known which contains alcohol and is used as a beverage, but does not include:

(a)(i) wine when manufactured or made for home consumption and which is not sold by the maker thereofof the wine or by another person; or

(b)(ii) a beverage declared by statute to be nonalcoholic or nonintoxicating;.

(b)'Alcoholic liquor by the drink' or 'alcoholic beverage by the drink' means a drink poured from a container of alcoholic liquor, without regard to the size of the container for consumption on the premises of a business licensed pursuant to Article 5 of this chapter."

SECTION 10. Section 61-6-20(5) of the 1976 Code, as added by Act 415 of 1996, is amended to read:

"(5) 'Minibottle' means a sealed container of two ouncesfifty milliliters or less of alcoholic liquor."

SECTION 11. Section 61-6-185 of the 1976 Code, as added by Act 363 of 1998, is amended to read:

"Section 61-6-185. (A) A person residing in the county in which a retail liquor license is requested to be granted, or a person residing within five miles of the location for which a retail liquor license is requested, may protest the issuance or renewal of the license if he files a written protest setting forthproviding:

(1) the name, address, and telephone number of the person filing the protest;

(2) the name of the applicant for the license and the address of the premises sought to be licensed, or the name and address of the license holder if the application is for renewal;

(3) the specific reasons why the application should be denied; and

(4) whether or not he wishes to attend a contested case hearing before the Administrative Law Judge DivisionCourt.

(B) Upon receipt of a timely filed protest, the department shall determine the protestant's intent to attend a contested hearing before the Administrative Law Judge DivisionCourt. If the protestant intends to attend a contested hearing, the department may not issue the permanent license but shall forward the file to the Administrative Law Judge DivisionCourt.

(C) If the protestant during the investigation expresses no desire to attend a contested hearing and offer testimony, the protest is deemed invalid, and the department shall continue to process the application and shall issue the license if all other statutory requirements are met.

(D) A person who files a protest and fails to appear at a hearing after affirming a desire to attend the hearing may be assessed a penalty to include court costs."

SECTION 12. Section 61-6-700 of the 1976 Code, as added by Act 415 of 1996, is amended to read:

"Section 61-6-700. An establishment which offers meals to the public must be licensed by the department to purchase and possess liqueurs, wines, and similar alcoholic beverages used solelyonly in the cooking and preparing of foods served by the establishment. Application for the license must be in a form and under conditions prescribed by the department. The license fee is fifty dollars. A person violating this section is guilty of a misdemeanor and, upon conviction, must be fined five hundred dollars, and other licenses he holds from the department underpursuant to the provisions of this title must be revoked.

The license provided in this section does not alter or limit the privileges or responsibilities for holders of licenses issued to authorize the possession, sale, and consumption of alcoholic liquors in minibottles underby the drink pursuant to the provisions of Article 5 of this chapter. EstablishmentsAn establishment so licensed may use alcoholic liquors in the preparation of food without obtaining the license provided for in this section if only liquors in minibottles are used in the food preparation."

SECTION 13. Section 61-6-1500 of the 1976 Code, as last amended by Act 40 of 2003, is further amended to read:

"Section 61-6-1500. (A) NoA retail dealer may not:

(1) sell, offer for sale, barter, exchange, give, transfer, or deliver or permit to be sold, bartered, exchanged, given, transferred, or delivered alcoholic liquors in less quantities than two hundred milliliters;

(2)own or keep in his possession alcoholic liquors in separate containers containing less than two hundred milliliters;

(3)notwithstanding items (1) and (2), a retail dealer may sell, offer for sale, barter, exchange, give, transfer, deliver, permit to be sold, own, or keep in his possession alcoholic liquors in separate containers containing one hundred milliliters provided that such containers are packaged together into a single unit of not less than four one hundred milliliter containers;

(4) sell, barter, exchange, give, transfer, or deliver,or offer for sale, barter, or exchange, or permit the sale, barter, exchange, or gift, transfer, or delivery of alcoholic liquors without regard to the size of the container:

(a) between the hours of 7:00 p.m. and 9:00 a.m.;

(b) for consumption on the premises;

(c) to a person under twenty-one years of age;

(d) to an intoxicated person; or

(e) to a mentally incompetent person;

(5)(2) permit the drinking of alcoholic liquors in his store or place of business;

(6)(3) sell alcoholic liquors on credit; however, this item does not prohibit payment by electronic transfer of funds if:

(a) the transfer of funds is initiated by an irrevocable payment order on or before delivery of the alcoholic liquors; and

(b) the electronic transfer is initiated by the retailer no later than one business day after delivery; or

However, during restricted hours a retail dealers aredealer is permitted to receive, stock, and inventory merchandise, provide for maintenance and repairs, and other necessary, related functions that do not involve the sale of alcoholic liquors.

(B)(1) The provisions of subsection (A) relating to quantities of less than two hundred milliliters do not apply to:

(a)minibottles when authorized by law to be sold to persons licensed to sell minibottles for on-premises consumption; or

(b)minibottles sold for consumption on commercial aircraft engaged in interstate commerce.

(2) It is unlawful for a person licensed to sell alcoholic liquors underpursuant to the provisions of this section to knowingly and wilfully refill, partially refill, or reuse a bottle of lawfully purchased alcoholic liquor, or otherwise tamper with the contents of the bottlea minibottle.

(2)A person who violates the provisions of this section is guilty of a misdemeanor and, upon conviction:

(a)for a first offense, must be fined five hundred dollars or imprisoned for not more than thirty days, or both;

(b)for a second or subsequent offense, must be fined one thousand dollars or imprisoned not more than six months, or both.

(3)In addition to the penalties provided in subsection (B), a violation of this section may subject the licensee or permit holder to revocation or suspension of the license or permit by the department.

(4)The possession of a refilled or reused bottle or other container of alcoholic liquors is prima facie evidence of a violation of this section. A person who violates this provision must, upon conviction, have his license revoked permanently.

(3)(C) A retail dealer must keep a record of all sales of alcoholic liquors sold in minibottlesto establishments licensed for on-premises consumption. The record must include the name of the purchaser and the date and quantity of the sale by brand and bottle size.

(4)(D) It is unlawful to sell minibottlesalcoholic liquors except during lawful hours of operation.

(5)A retail dealer who sells alcoholic liquors in minibottles to a person not licensed under Article 5 of this chapter is guilty of a misdemeanor and, upon conviction, must be fined not more than one thousand dollars and his retail dealer's license may be suspended or revoked in the discretion of the department. As used in this subsection, 'a person licensed under Article 5 of this chapter' includes a person's designated agent as a purchaser."

SECTION 14. Section 61-6-1540 of the 1976 Code is amended to read:

"Section 61-6-1540. (A) Except as provided in subsection (B), no other goods, wares, or merchandise may be kept or stored in or sold in or from a retail alcoholic liquor store or place of business, and no place of amusement may be maintained in or in connection with the store. However, retail dealers may sell:

(1) drinking glassware packaged together with alcoholic liquors if the glassware and alcoholic liquors are packaged together by the wholesaler or producer in packaging provided by the producer;

(2) nonalcoholic items, other than beer or wine, packaged together with alcoholic liquors if the nonalcoholic items and alcoholic liquors are in sealed packages and are packaged together by the alcoholic liquor producer at its place of business; and

(3) lottery tickets under the provisions of Chapter 150 of Title 59.

(B) Retail dealers licensed under the ABC Actpursuant to the provisions of this article may sell all wines in the stores or places of business covered by their respective licenses, whether declared alcoholic or nonalcoholic or nonintoxicating by the laws of this State. Wines containing more than fourteensixteen percent of alcohol by volume may be sold only in licensed alcoholic liquor stores or in establishments licensed to sell and permit consumption of alcoholic liquors in minibottlesby the drink. The provisions of this section must not be construed to amend, alter, or modify the taxes imposed on wines or the collection and enforcement of these taxes."

Section 61-6-1600. (A) A nonprofit organization which is licensed by the department pursuant to the provisions of this article may sell alcoholic liquors in minibottlesby the drink. A member or guest of a member of a nonprofit organization may consume alcoholic liquors sold in minibottlesby the drink upon the premises between the hours of ten o'clock in the morning and two o'clock the following morning.

(B) An employee or agent of an establishment licensed as a nonprofit organization is prohibited from selling, making available for sale, or permitting the consumption of alcoholic liquors on the licensed premises between the hours of two o'clock in the morning and ten o'clock in the morning. A violation of this provision is a violation against the organization's license.

Section 61-6-1610. (A) Except on Sunday, it is lawful to sell and consume alcoholic liquors sold in minibottlesby the drink in a business establishment between the hours of ten o'clock in the morning and two o'clock the following morning if the establishment meets the following requirements:

(1) the business is bona fide engaged primarily and substantially in the preparation and serving of meals or furnishing of lodging; and

(2) the business has a license from the department authorizing the sale and consumption of alcoholic liquors by the drink, which is conspicuously displayed conspicuously on the main entrance to the premises and clearly visible from the outside.

(B) Notwithstanding any otheranother provision of this article, the licensed premises of a business establishment which is bona fide engaged primarily and substantially in the preparation and service of meals and which holds a valid license for the sale and consumption of alcoholic liquors in minibottlesby the drink do not extend to any portion of the business establishment or the property upon which it is located which is designed as or used for a parking area even though food may be served in the area.

(C) An establishment licensed underpursuant to the provisions of this article may use alcoholic liquors in the preparation of food without obtaining the license provided for in Section 61-6-700 if only liquors in minibottles are used in the food preparation.

(D) Any licensee, employee, or agent of an establishment licensed as a food service establishment or place of lodging is prohibited from selling, making available for sale, or permitting the consumption of alcoholic liquors on the licensed premises between the hours of two o'clock in the morning and ten o'clock in the morning. However, any licensee, employee, or agent of an establishment licensed as a food service establishment or place of lodging is prohibited from selling, making available for sale, or permitting the consumption of alcoholic liquors on Sunday unless the establishment has been issued for that Sunday a temporary permit pursuant to the provisions of Section 61-6-2010. A violation of this subsection is a violation against the establishment's license.

(E)It is unlawful for a person licensed to sell alcoholic liquor by the drink pursuant to the provisions of this section to knowingly and wilfully refill, partially refill, or reuse a bottle of lawfully purchased alcoholic liquor, or otherwise tamper with the contents of the bottle.

A person who violates the provisions of this section is guilty of a misdemeanor and, upon conviction:

(a)for a first offense, must be fined five hundred dollars or imprisoned for not more than thirty days, or both;

(b)for a second or subsequent offense, must be fined one thousand dollars or imprisoned for not more than six months, or both.

(F)In addition to the penalties provided in subsection (E), a violation of this section may subject the licensee or permit holder to revocation or suspension of the license or permit by the department.

(G)The possession of a refilled or reused bottle or other container of alcoholic liquors is prima facie evidence of a violation of this section. A person who violates this provision must, upon conviction, have his license revoked permanently.

Section 61-6-1620. (A) This article must not be construed to authorizeauthorizes the possession or consumption of alcoholic liquors in containers other than minibottles on premises open to the general public for which a license has been obtained pursuant to Sections 61-6-1600 or 61-6-1610.

(B) Alcoholic liquors may be possessed or consumed in separate and private areas of an establishment whether or not the establishment includes premises which are licensed pursuant to Sections 61-6-1600 or 61-6-1610, where specific individuals have leased these areas for a function not open to the general public.

Section 61-6-1630. (A)Alcoholic liquors in minibottles as authorized to be sold under this article must be purchased only by a person licensed under this article, in case lots, and only from licensed retail dealers. As used in this section, 'a person licensed under this article' includes his designated agent as a purchaser.

(B)No person licensed under the provisions of this article may be licensed as a retail dealer on the same premisesA person licensed to sell alcoholic liquor by the drink for on-premises consumption must not be licensed as a retail dealer on the same premises.

Section 61-6-1640. Notwithstanding the provisions of this subarticle or any other provision of law, an establishment licensed pursuant to Article 5 of this chapter is authorized to conduct samplings of wines in excess of sixteen percent alcohol, cordials, and distilled spirits, if the sampling is conducted as follows:

(1) the establishment must have a permanent seating capacity of fifty or more persons;

(2) samples may not be offered from more than four products at any one time;

(3) the sampling must be held in the bar area of a licensed establishment and all open bottles must be visible at all times. All open bottles must be removed at the conclusion of the tasting;

(4) samples must be less than one-half ounce for each product sampled;

(5) a person may not be served more than one sample of each product;

(6) sampling may not be offered for more than four hours;

(7) at least five days before the sampling, a letter detailing the specific date and hours of the sampling must be mailed first class to the South Carolina Law Enforcement Division;

(8) a sample may not be offered to, or allowed to be consumed by, an intoxicated person or a person under the age of twenty-one years;

(9) a licensed establishment may not offer more than one sampling each day; and

(10) the sampling must be conducted by the manufacturer or wholesaler or an agent of the manufacturer or wholesaler."

SECTION 16. Section 61-6-1825 of the 1976 Code, as added by Act 363 of 1998, is amended to read:

"Section 61-6-1825. (A) A person residing in the county in which a minibottle license pursuant to the provisions of subarticle 1 of this article is requested to be granted, or a person residing within five miles of the location for which a minibottle permit pursuant to the provisions of subarticle 1 of this article is requested, may protest the issuance or renewal of the license if he files a written protest setting forthproviding:

(1) the name, address, and telephone number of the person filing the protest;

(2) the name of the applicant for the license and the address of the premises sought to be licensed, or the name and address of the license holder if the application is for renewal;

(3) the specific reasons why the application should be denied; and

(4) whether or not he wishes to attend a contested case hearing before the Administrative Law Judge DivisionCourt.

(B) Upon receipt of a timely filed protest, the department shallmust determine the protestant's intent to attend a contested hearing before the Administrative Law Judge DivisionCourt. If the protestant intends to attend a contested hearing, the department maymust not issue the permanent license but shallmust forward the file to the Administrative Law Judge DivisionCourt.

(C) If the protestant during the investigation expresses no desire to attend a contested hearing and offer testimony, the protest is deemed invalid, and the department shall continue to process the application and shall issue the license if all other statutory requirements are met.

(D) A person who files a protest and fails to appear at a hearing after affirming a desire to attend the hearing may be assessed a penalty to include court costs."

SECTION 17. Section 61-6-2000 of the 1976 Code is amended to read:

"Section 61-6-2000. In addition to the minibottle licenses authorized underpursuant to the provisions of subarticle 1 of this article, the department also may also issue a temporary license for a period not to exceed twenty-four hours to a nonprofit organizationsorganization which authorizes these organizationsan organization to purchase and sell at a single social occasion alcoholic liquors in minibottlesby the drink. Notwithstanding any otheranother provision of this article, the issuance of this permit authorizes the organization to purchase alcoholic liquors in minibottles from licensed retail dealers in the same manner that personsa person with a biennial minibottle licenseslicensed is issued pursuant to the provisions of subarticle 1 of this article are authorized to make these purchases. The fee for the permit is thirty-five dollars payable at the time of application. The permit application must include a statement by the applicant as to the amount of alcoholic liquors to be purchased and the nature and date of the social occasion at which they are to be sold. The issuance or nonissuance of permits authorized underpursuant to the provisions of this section is within the sole discretion of the department."

SECTION 18. Section 61-6-2005(A) of the 1976 Code, as last amended by Act 442 of 1998, is further amended to read:

"(A) A person who purchases or acquires by lease, inheritance, divorce decree, eviction, or otherwise a retail business which sells alcoholic liquors in sealed containers of two ounces or lessby the drink from a holder of a license to sell alcoholic liquors in sealed containers of two ounces or lessby the drink at the business, upon initiating the application process for a permanent license, may be issued a temporary license by the department at the time of the purchase or acquisition if the location for which the temporary license is sought is not considered by the department to be a public nuisance, and the applicant:

(1) the applicant currently holds a valid license to sell alcoholic liquors in sealed containers of two ounces or lessby the drink; or

(2) the applicant has had a criminal history background check conducted by the State Law Enforcement Division within the past thirty days."

SECTION 19. Section 61-6-2010 of the 1976 Code is amended to read:

"Section 61-6-2010. (A) In addition to the provisions of Section 61-6-2000, the department may issue a temporary permit to allow the possession, sale, and consumption of alcoholic liquors in sealed containers of two ounces or lessby the drink. This permit is valid for a period not to exceed twenty-four hours and may be issued only to bona fide nonprofit organizations and business establishments otherwise authorized to be licensed for sales. The department shall charge a nonrefundable filing fee of one hundred dollars for processing each application and a daily permit fee of fifty dollars for each day for which a permit is approved. An application must be filed for each permit requested. The department must also offer the option of an annual fifty-two week temporary permit for a nonrefundable fee of three thousand dollars per year. However, the optional fifty-two week permit must not extend beyond the expiration date of the biennial license issued pursuant to this chapter. If the expiration date is less than fifty-two weeks from the date of the application for the optional fifty-two week permit, the department must prorate the three thousand dollar fee on a monthly basis. The department in its sole discretion shall specify the terms and conditions of the permit.

(B)(1) The filing and permit fees must be distributed by the State Treasurer to the municipality or county in which the retailer who paid the fee is located. The revenue may be used only by the municipality or county for the following purposes:

(g) acquiring fee and less than fee interest in land while it is still available to be held in perpetuity as wildlife preserves or believed to be needed by the public in the future for active and passive recreation uses and scenic easements, to include the following types of land: ocean, harbor, and pond frontage in the form of beaches, dunes, and adjoining backlands; barrier beaches; fresh and saltwater marshes and adjoining uplands; land for bicycle paths; land protecting existing and future public water supply, well fields, highway buffering and aquifer recharge areas; land for wildlife preserves; and land for future public recreational facilities;

(i) dune restoration, including the planting of grass, sea oats, or other vegetation useful in preserving the dune system;

(j) maintenance of public beach access;

(k) capital improvements to the beaches and beach-related facilities, such as public parking areas for beach access; dune walkovers and restroom facilities, with or without changing rooms, at public beach parks; and

(l) construction and maintenance of drainage systems.

(2) The revenue may not be used for operating expenses of tourism-related buildings.

(C)(1) PermitsA permit authorized by this section may be issued only in those counties or municipalities where a majority of the qualified electors voting in a referendum vote in favor of the issuance of the permitspermit. The county or municipal election commission, as the case may be, shall conduct a referendum upon petition of at least ten percent but not more than seven thousand five hundred qualified electors of the county or municipality, as the case may be. The petition form must be submitted to the election commission not less than one hundred twenty days before the date of the referendum. The names on the petition must be on the petition form provided to county election officials by the State Election Commission. The names on the petition must be certified by the election commission within sixty days after receiving the petition form. The referendum must be conducted at the next general election. The election commission shall cause a notice to be published in a newspaper circulated in the county or municipality, as the case may be, at least seven days before the referendum. The state election laws shall apply to the referendum, mutatis mutandis. The election commission shall publish the results of the referendum and certify them to the South Carolina Department of Revenue. The question on the ballot shall be one of the following:

(a) 'Shall the South Carolina Department of Revenue be authorized to issue temporary permits in this (county) (municipality) for a period not to exceed twenty-four hours to allow the possession, sale, and consumption of alcoholic liquors in sealed containers of two ounces or lessby the drink to bona fide nonprofit organizations and business establishments otherwise authorized to be licensed for consumption-on-premises sales?' or

(b) 'Shall the South Carolina Department of Revenue be authorized to issue temporary permits in this (county) (municipality) for a period not to exceed twenty-four hours to allow the possession, sale, and consumption of alcoholic liquors in sealed containers of two ounces or lessby the drink to bona fide nonprofit organizations and business establishments authorized to be licensed for consumption-on-premises sales and to allow the sale of beer and wine at permitted off-premises locations without regard to the days or hours of sales?' or

(c)in case of a county or municipality where temporary permits are authorized to be issued pursuant to this section as of June 21, 1993, the question may be 'Shall the Department of Revenue be authorized to issue temporary permits in this (county) (municipality) for a period not to exceed twenty-four hours to allow the sale of beer and wine at permitted off-premises locations without regard to the days or hours of sales?'.

(2) A referendum for this purpose may not be held more often than once in forty-eight months.

(3) The expenses of any suchfor a referendum for this purpose must be paid by the county or municipality conducting the referendum.

(D)(1) The municipal governing body may order a referendum on the question of the issuance of temporary permits to allow the possession, sale, and consumption of alcoholic liquors in sealed containers of two ounces or lessby the drink in the following circumstances:

(a) parts of the municipality are located in more than one county;

(b) as a result of a favorable vote in a county referendum held pursuant to this section, permits may be issued in only the parts of the municipality located in that county; and

(c) the proposed referendum would authorize issuance of permits in the remaining parts of the municipality.

(2) The method of ordering a referendum provided in this subsection is in addition to the petition method provided in subsection (C). An unfavorable vote in a municipal referendum does not affect the authority to issue these permits in the part of the municipality located in a county where these permits may be issued.

(3) Upon receipt of a copy of the ordinance filed with the municipal election commission at least sixty days before the date of the general election, the commission must conduct the referendum at the time of the general election and publish and certify its results in the same manner as provided in subsection (C). Subsection (C)(2) does not apply to this referendum."

SECTION 20. Subarticle 7, Article 5, Chapter 6, Title 61 of the 1976 Code, as added by Act 415 of 1996, is amended to read:

"Subarticle 7

Provisions Relating to Sales, Delivery, and

Consumption of Liquor in Minibottles

Section 61-6-2200. NoA person may not serve or deliver to a purchaser alcoholic liquors in minibottlesby the drink in a business where these sales are authorized unless the person is eighteen years of age or older; nothing contained in this section may be construed as allowing bartenders under the age of twenty-one.

Section 61-6-2210. The purchaser must break the seal of a minibottle unless the seller breaks the seal in the presence of the purchaser and delivers the container.Reserved.

Section 61-6-2220. No person or establishment licensed to sell alcoholic beveragesliquors or liquor by the drink pursuant to this article may sell these beverages to persons in an intoxicated condition; these sales are considered violations of the provisions thereof and subject to the penalties contained herein.

Section 61-6-2230. (A) No person licensed to sell alcoholic beveragesliquors or liquor by the drink pursuant to this article may knowingly conduct, operate, organize, promote, advertise, run, or participate in a 'drinking contest' or 'drinking game'.

(B) For purposes of this section, 'drinking contest' or 'drinking game' includes, but is not limited to, a contest, game, event, or other endeavor which encourages or promotes the consumption of alcoholic beverages by participants at extraordinary speed or in increased quantities or in more potent form. 'Drinking contest' or 'drinking game' does not include a contest, game, event, or endeavor in which alcoholic beverages are not used or consumed by participants as part of the contest, game, event, or endeavor but instead are used solely as a reward or prize. Selling alcoholic beverages in the regular course of business is not considered a violation of this section."

SECTION 21. Section 61-6-2400 of the 1976 Code is amended to read:

"Section 61-6-2400. Alcoholic liquors sold in minibottlesby the drink must be taxed pursuant to Chapter 33 of, Title 12."

SECTION 22. Section 61-6-2420 of the 1976 Code is amended to read:

"Section 61-6-2420. This article does not authorize a Class B Restaurant to sell, dispense, barter, or trade in minibottlesalcoholic liquors by the drink. The law controlling Class B Restaurants in reference to the sale or dispensing of alcoholic liquors is not affected in any manner."

SECTION 23. Section 61-6-2600 of the 1976 Code is amended to read:

"Section 61-6-2600. AExcept as otherwise provided in this title, a person who transports, possesses, or consumes alcoholic liquors except in a manner permitted by this article or a person who violates any of the provisions thereofof this article is guilty of a misdemeanor and, upon conviction, must be fined not more than one hundred dollars or imprisoned for not more than thirty days. In addition, a person licensed to sell alcoholic liquors pursuant to the provisions of this article who has in his possession on his licensed premises alcoholic liquors in containers other than minibottles, except wine as authorized for sale under Section 61-6-1540(B), or who displays minibottles when the seals are brokenacts to avoid the payment of the excise tax imposed on the serving of alcoholic beverages by the drink provided for in Chapter 33, Title 12 or who violates any otheranother provision of this article must:

(1) for a first offense, be fined not less than two hundred dollars nor more than five hundred dollars or have his license suspended for not more than thirty days, or both;

(2) for a second offense within three years of the first offense, be fined not less than two hundred dollars nor more than five hundred dollars or have his license suspended for not more than one hundred eighty days, or both;

(3) for a third offense within three years of the first offense, be fined not less than five hundred dollars and have his license revoked permanently;

(4) for a violation involving the avoidance of taxes, a fine ofbe fined not less than one thousand dollars and permanent revocation of his license."

SECTION 24. (A)(1) A study committee must be created to examine the delivery and distribution of alcoholic liquors by licensed retail dealers with a wholesaler's basic permit issued pursuant to the Federal Alcohol Administration Act and shall issue a report on its findings. The study committee consists of six members to be appointed as follows:

(a) three members to be appointed by the President pro Tempore of the Senate, and

(b) three members to be appointed by the Speaker of the House of Representatives.

(2) The chairman of the Senate Judiciary Committee shall provide appropriate staff for the Senate members and the chairman of the House Judiciary Committee shall provide appropriate staff for the House members.

(B) The study committee shall report its findings to the President pro Tempore of the Senate and the Speaker of the House of Representatives no later than the second Tuesday of January 2007 and terminates when the report is made.

(C) The purpose of the report is to enable the General Assembly to consider the findings of the study committee and to determine if the findings should be adopted and if state laws should be amended.

SECTION 25. This act establishes a license to sell alcoholic liquors by the drink. All statutes and regulations applicable to minibottle licenses or permits or applications for licenses or permits apply to licenses or permits for alcoholic liquors by the drink. All minibottle licenses or permits in effect before the effective date of this act are considered to be licenses or permits to sell alcoholic liquors by the drink after the effective date of this act through the expiration of the license or permit.

SECTION 26. If any section, subsection, item, subitem, paragraph, subparagraph, sentence, clause, phrase, or word of the 1976 Code as added by this act is for any reason held to be unconstitutional or invalid, such holding shall not affect the constitutionality or validity of the remaining portions of the chapter, the General Assembly hereby declaring that it would have passed each and every section, subsection, item, subitem, paragraph, subparagraph, sentence, clause, phrase, and word thereof, irrespective of the fact that any one or more other sections, subsections, items, subitems, paragraphs, subparagraphs, sentences, clauses, phrases, or words hereof may be declared to be unconstitutional, invalid, or otherwise ineffective.

SECTION 27. This act takes effect on January 1, 2006, except that beginning on July 1, 2005, or upon approval of this act by the Governor, whichever is the earlier date, a licensed retail dealer with a wholesaler's basic permit issued pursuant to the Federal Alcohol Administration Act may deliver, in sealed containers, alcoholic liquor in minibottles to a person licensed under the provisions of Article 5, Chapter 6, Title 61 of the 1976 Code for sale for on-premises consumption. Each person licensed pursuant to the Alcoholic Beverage Act to sell or purchase minibottles must take an inventory of minibottles in the licensee's possession as of the effective date and send within sixty days a certified copy of the inventory to the Department of Revenue. By no later than January 1, 2006, the department must devise a method whereby the twenty-five cents excise tax on minibottles previously paid by the licensees is credited to each licensee so that on or after the effective date, the tax rate paid on each minibottle is prorated in accordance with the terms of this act.